Earlier this year, Microsoft acquired popular code repository hosting service GitHub for $7.5 billion, and now IBM has just announced the biggest open-source business deal ever.
IBM today confirmed that it would be acquiring open source Linux firm Red Hat for $190 per share in cash, working out to a total value of approximately $34 billion.
Red Hat, known for its Red Hat Enterprise Linux (RHEL) operating system, is a leading software company that offers open-source software products to the enterprise community. Even Oracle uses Red Hat’s source code for its Oracle Linux product.
Red Hat’s last year revenue was $2.4 billion, and this year the company has earned $2.9 billion. But if Red Hat products are open source and updates are free, you might be wondering how does the company earn.
Red Hat was one of the first companies who found a successful way to make money from free open-source software. It offers consulting services—including assessments, implementations, platform migrations, solution integration, and application development.